How these Chief Sustainability Officers are leading Tatas, Mahindras deeper into their journey

These Groups are absorbing and putting into practice the rapidly evolving tenets of sustainability in a more pervasive, deeper and meaningful manner than ever before.Naren Karunakaran | ET Bureau | April 15, 2016, 08:30 IST

How these Chief Sustainability Officers are leading Tatas, Mahindras deeper into their journeyWhen two large Indian business groups – the Tatas, and the Mahindras - with a combined turnover exceeding $ 155 billion begin to address an issue it moves the needle.

These Groups are absorbing and putting into practice the rapidly evolving tenets of sustainability in a more pervasive, deeper and meaningful manner than ever before.

And with it, Indian companies are competing with their global peers in turning the world into a better place to live in, with varying degrees of success.

That sustainability, separate from CSR or corporate philanthropy, is finally coming out of the shadows in India is also bared by the manner in which competing companies are coming together to address sustainability challenges facing an entire industry sector; like the Sustainable Housing Leadership Consortium.

The consortium is expected to catalyse action to render at least 20 per cent of new housing construction sustainable by 2022 through green certification and other measures.

Much of the excitement in this space is being driven by the first crop of corporate India’s chief sustainability officers (CSOs) in their own unique ways and approaches, given the dynamics of the group they are in, their personal beliefs and the challenges on hand.

Ahead of the 2015 Climate Conference in Paris, insiders suggested to Cyrus P Mistry, Chairman of the $ 108 billion Tata Group that he sign the ‘Paris Pledge for Action Petition’ crafted by the CEO Climate Leaders. Mistry was hesitant.

Hesitant, not because he didn’t want to commit his businesses to climate action but because he abhors high- optics approaches to issues. Mistry roots for a quiet meeting of goals and targets.

Mukund Rajan, member of the Group Executive Council (GEC) of Tata Sons had to muster all his persuasion skills to get the chairman to sign up. Mukund, the Tata brand custodian and chief ethics officer also oversees the sustainability function.

“This is how we are,” says Shankar Venkateswaran, alluding to the muted, yet considerable work that is on, across Tata companies. He joined the Group only in 2014 and has, evidently, absorbed its values.

Shankar comes to the Group with over three decades in developmental and business consulting work- from Action Aid to pwc - even serving as India head of the London-based SustainAbility, the strategy consulting firm of John Elkington, who coined the term ‘triple- bottom-line,’ years ago.

He was also on the drafting committee which drew out the National Voluntary Guidelines (NVGs) on corporate responsibility. It’s being updated now.

Many of his colleagues and peers in industry consider Shankar to harbour a social or a society bias. ‘Business and society’ has remained an area of abiding interest through much of his career. In a way, it’s in consonance with the Tata world view.

The attitude also reflects in the Tata Group Sustainability Policy announced in mid- 2015 which, among other things, not only embeds a product life- cycle approach to sustainability but also,very boldly, commits to natural and social capital valuation.

“Next year on we want to engage with our companies on circularity,” reveals Shankar. Circularity addresses the limitations of the traditional, linear model of consumption and is the latest in sustainability thinking. A circular economy or model revolves around resource constraints and primarily attempts to ‘design out’ waste.

Shankarhas been lucky as circumstances helped him cobble a group-wide sustainability mechanism with considerable ease immediately on joining; else to conjure a system to address 100 independent operating companies, 20 of which are listed, and present in 100 countries across six contents, could have been daunting indeed. Things fell in place: those at the helm of the Tata Council for Community Initiatives (TCCI), largely the CSR arm of the Tata’s, were retiring; the environment sustainability group housed in Tata Quality Management Services (TQMS) was ready to move out and claim independent status.

TQMS is a crucible of sorts within the Group to test out ideas and innovations.

TCCI and the enviro group were quickly merged to form the Tata Sustainability Group (TSG) to provide thought leadership in this space.

Tata Relief, the Group’s disaster response initiative,was also brought under its ambit.

A geographic structure too emerged in the form of a Global Sustainability Council, chaired by MukundRajan and 15 CEOs as members including those of Tata Steel Europe and JLR.

Early this year, when the Mahindra Group unveiled petrol engine vehicles within a couple of months of the ban on big diesel vehicles in Delhi, it took the establishment by surprise.

How did this blitzkrieg-like response come about? Only insiders know that it emerged from an intense scenario planning engagement of years within the Group centred on sustainability and the future of mobility.

Over the past eight years, the $ 16.9 billion Mahindra Group has evolved into a business entity with a remarkable degree of sustainability thinking. Petrol and smaller diesel engines, expectedly, were already in the works.

And it helps if the person driving Group sustainability, Anirban Ghosh, earned his spurs in sales, marketing, and importantly, strategy.

Anirban, on his return to India, after a harrowing stint in the US, leading the tractor business, during the 2008 financial crisis, has been pivotal in the creating the Group’s agri vertical.

“My approach to sustainability is not from an activists’ perspective. It comes from hard-core business,” says Anirban.

The Group, seen as a federation of companies, has notched remarkable progress in the usual indicators: water conservation, waste management, and energy efficiency.

The Group has signed up for EP 100 of the Climate Group to double energy productivity by 2030. “Energy efficiency gives us greater and faster returns than many of the products we invest in,” he explains.

Chairman Anand Mahindra champions sustainability and also recently signed up to the global Carbon Pricing Leadership Coalition. The tone from the top is critical. Anand is slowly acquiring a sustainability mien.

He says: “Our effort to erase the perceived dichotomy between sustainability and profits is paying rich dividends.”

Apart from quickly plucking the low hanging fruit in sustainability, the Group is seriously looking at greening its portfolio. Micro irrigation, solar, electric vehicles are coming centrestage.

It’s around half a billion dollars turnover already and is expected to double in five years, if not earlier. The runaway success of the recent global launch of the Model 3 electric car by Tesla and its intention to come to India is a good augury. Mahindra acquired Reva Electric Car Co. in 2010.

How did Anirban and the Group’s Sustainability Council, take the agenda across its 28 varied businesses? It has been a mix of evangelism and a nudge with processes.

All CEOs are encouraged to lay out a path to sustainability for which a dashboard has been created. The dashboard is re-configured every six months and displays each company’s progress.

Anirban often pitches in with the ‘business case;’ critical for convincing reluctant CEOs, showing how adoption will increase their profitability. Sustainability is now also integral to the Mahindra way- basically a TQM process spread across all group businesses.

He has, in a way, simplified or demystified sustainability for seniors within the Group as many hail from a generation or ecosystem not attuned to sustainability thinking. “It’s spoonfeeding,” says Anirban, “you plug it into a process and CEOs learn from it.”

The proliferation of sustainability thinking is evident by the response of Group companies. Anita Arjundas of Mahindra Lifespace Developers, for instance, began looking for a replacement to sand that is rapaciously mined, destroying riverine ecosystems. She now supports many entrepreneurs who supply her co. with ‘manufactured-sand.’ “The switch has also impacted project efficiency significantly,” says Anita.

Anirban, meanwhile, is battling a particular challenge which many sustainability professionals also face. ‘How do I communicate sustainability to individuals, to employees, to consumers?’

This is the question that bedevils him. He made a small dent last year when he announced a scheme to refund electricity bills to employees who showed a dip in power consumption at home over a six month period. The response is muted but converts are emerging.​